Forbes estimates Jan. 2 mass attack cost Russia nearly $620 million
Daria Shulzhenko – January 2, 2024
Russian forces launched at least 99 missiles of various types and 35 Shahed “kamikaze” drones against Ukraine on Jan. 2, costing Russia nearly $620 million, Forbes estimated.
Russia’s large-scale coordinated missile attack targeted Kyiv, the surrounding region, and Kharkiv on the morning of Jan. 2. It was preceded by a wave of Shahed drones. The attack killed five people and injured 127, including children, according to the latest update by the State Emergency Service.
The Air Force reported earlier that Ukraine intercepted all of the drones and 72 Russian missiles, including 59 Kh-101/555/55 cruise missiles, three Kalibr cruise missiles, and all of the 10 Kh-47M2 Kinzhal air-launched ballistic missiles. Russian forces also used 12 ballistic missiles of the Iskander/S-300/S-400 type and four Kh-31P anti-radar missiles.
Forbes calculated the cost based on the estimates that one Russian Kh-101 cruise missile costs $13 million, a Kalibr cruise missile costs $ 6.5 million, a Kinzhal ballistic missile costs $15 million, an Iskander costs $3 million, and one Shahed 136 drone costs $50,000, among others.
“Due to the fact that the precise distribution of missiles by type remains unknown, Forbes estimates their total cost at approximately $620 million,” the media wrote.
World could implement five measures after 2 new large-scale Russian attacks on Ukraine – Ukraine’s Foreign Minister
Ukrainska Pravda – January 2, 2024
Photo: Getty Images
Dmytro Kuleba, Minister of Foreign Affairs of Ukraine, is waiting for Western countries to react and take decisive measures after another large-scale Russian attack on Ukraine on 2 January.
Quote: “Putin escalates terror against Ukraine. Today was the second mass missile strike in just four days. Civilian infrastructure has been damaged; people, including children, have been injured and killed.
We expect all states to strongly condemn the attack and take resolute action.”
Putin escalates terror against Ukraine. Today was already the second mass missile strike in just four days. Civilian infrastructure has been damaged; people, including children, have been injured and killed.
We expect all states to strongly condemn the attack and take resolute…
— Dmytro Kuleba – January 2, 2023
Details: Kuleba thinks the world could implement five measures right now:
expedite the delivery of additional air defence systems and ammunition to Ukraine;
provide Ukraine with combat drones of all types;
provide Ukraine with long-range missiles with a range of over 300 km;
approve the use of frozen Russian assets to help Ukraine;
isolate Russian diplomats in relevant capitals and international organisations.
“The terrorist regime in Moscow must realise that the international community will not turn a blind eye to the murder of civilians and the destruction of civilian infrastructure in Ukraine,” Kuleba stressed.
Background:
Russia launched a massive missile attack on Ukraine on the morning of 2 January. Missile debris has crashed in the Pecherskyi, Obolonskyi, Holosiivskyi and Sviatoshynskyi districts of the city of Kyiv. There were also hits in Kharkiv.
Valerii Zaluzhnyi, Commander-in-Chief of the Armed Forces of Ukraine, reported that the Russians had launched 99 missiles of various types at Ukraine on the night of 1-2 January 2024, 72 of which were destroyed.
Bridget Brink, US Ambassador to Ukraine, said it was “urgent and critical” to support Ukraine now in order to stop Putin amid a new Russian large-scale attack on the morning of Tuesday, 2 January.
Poland scrambled its F-16 fighter jets due to a new Russian large-scale attack on 2 January.
Opinion Columnist, reporting from Dubai, United Arab Emirates.
Credit…Amir Cohen/Reuters
I’ve been The Times’s foreign affairs columnist since 1995, and one of the most enduring lessons I’ve learned is that there are good seasons and bad seasons in this business, which are defined by the big choices made by the biggest players.
My first decade or so saw its share of bad choices — mainly around America’s response to Sept. 11 — but they were accompanied by a lot of more hopeful ones: the birth of democracy in Russia and Eastern Europe, thanks to the choices of Mikhail Gorbachev. The Oslo peace process, thanks to the choices of Yitzhak Rabin and Yasir Arafat. China’s accelerating opening to the world, thanks to the choices of Deng Xiaoping. India’s embrace of globalization, thanks to choices initiated by Manmohan Singh. The expansion of the European Union, the election of America’s first Black president and the evolution of South Africa into a multiracial democracy focused on reconciliation rather than retribution — all the result of good choices from both leaders and led. There were even signs of a world finally beginning to take climate change seriously.
On balance, these choices nudged world politics toward a more positive trajectory — a feeling of more people being connected and able to realize their full potential peacefully. It was exciting to wake up each day and think about which one of these trends to get behind as a columnist.
For the last few years, though, I’ve felt the opposite — that so much of my work was decrying bad choices made by big players: Vladimir Putin’s tightening dictatorship and aggression, culminating in his brutal invasion of Ukraine; Xi Jinping’s reversal of China’s opening; Israel’s election of the most right-wing government in its history; the cascading effects of climate change; the loss of control over America’s southern border; and, maybe most ominously, an authoritarian drift, not only in European countries like Turkey, Poland and Hungary but in America’s own Republican Party as well.
To put it another way: If I think about the three pillars that have stabilized the world since I became a journalist in 1978 — a strong America committed to protecting a liberal global order with the help of healthy multilateral institutions like NATO, a steadily growing China always there to buoy the world economy, and mostly stable borders in Europe and the developing world — all three are being shaken by big choices by big players over the last decade. This is triggering a U.S.-China cold war, mass migrations from south to north and an America that has become more unreliable than indispensable.
But that’s not the half of it. Because now that advanced military technologies like drones are readily available, smaller players can wield much more power and project it more widely than ever before, enabling even their bad choices to shake the world. Just look at how shipping companies across the globe are having to reroute their traffic and pay higher insurance rates today because the Houthis, Yemeni tribesmen you never heard about until recently, have acquired drones and rockets and started disrupting sea traffic around the Red Sea and through the Suez Canal.
This is why I referred to Russia’s invasion of Ukraine as our first true world war, and why I feel that Hamas’s war with Israel is in some ways our second true world war.
They are being fought on both physical battlefields and digital ones, with huge global reach and implications. Like farmers in Argentina who were stymied when they suddenly lost their fertilizer supplies from Ukraine and Russia. Like young TikTok users around the world observing, opining, protesting and boycotting global chains, such as Zara and McDonald’s, after being enraged by something they saw on a 15-second feed from Gaza. Like a pro-Israel hacker group claiming credit for shutting down some 70 percent of Iran’s gas stations the other day, presumably in retaliation for Iran’s support for Hamas. And so many more.
Indeed, in today’s tightly wired world, it is possible that the war over the Gaza Strip — which is roughly twice the size of Washington, D.C. — could decide the next president in Washington, D.C., as some young Democrats abandon President Biden because of his support for Israel.
But before we become too pessimistic, let us remember that these choices are just that: choices. There was nothing inevitable or foreordained about them. People and leaders always have agency — and as observers we must never fall prey to the cowardly and dishonest “well, they had no choice” crowd.
Gorbachev, Deng, Anwar el-Sadat, Menachem Begin, George H.W. Bush and Volodymyr Zelensky, to name but a few, faced excruciating choices, but they chose forks in the road that led to a safer and more prosperous world, at least for a time. Others, alas, have done the opposite.
To close out the year, it’s through this prism of choices that I want to re-examine the story that has consumed me, and I dare say much of the world, since Oct. 7: the Israel-Hamas war. It was not as inevitable as some want you to think.
Credit…Samar Abu Elouf for The New York Times
I began thinking about this a few weeks ago, when I flew to Dubai to attend the United Nations climate summit. If you’ve never been there, the Dubai airport has some of the longest concourses in the world. And when my Emirates flight landed, we parked close to one end of the B concourse — so when I looked out the window I saw lined up in a perfectly symmetrical row some 15 Emirates long-haul passenger jets, stretching far into the distance. And the thought occurred to me: What is the essential ingredient that Dubai has and Gaza lacks? Because both began, in one sense, as the convergence of sand and seawater at crucial intersections of the world.
It’s not oil — oil plays only a small role in Dubai’s diversified economy today. And it’s not democracy. Dubai is not a democracy and does not aspire to be one. But people are now flocking to live here from all over the world — its population of more than 3.5 million has surged since the outbreak of Covid. Why? The short answer is visionary leadership.
Dubai has benefited from two generations of monarchs in the United Arab Emirates who had a powerful vision of how the U.A.E. in general and the emirate of Dubai in particular could choose to be Arab, modern, pluralistic, globalized and embracing of a moderate interpretation of Islam. Their formula incorporates a radical openness to the world, an emphasis on free markets and education, a ban on extremist political Islam, relatively little corruption, a strong rule of law promulgated from the top down and a relentless commitment to economic diversification, talent recruitment and development.
There are a million things one could criticize about Dubai, from labor rights for the many foreign workers who run the place to real estate booms and busts, overbuilding and the lack of a truly free press or freedom of assembly, to name but a few. But the fact that Arabs and others keep wanting to live, work, play and start businesses here indicates that the leadership has converted its intensely hot promontory on the Persian Gulf into one of the world’s most prosperous crossroads for trade, tourism, transport, innovation, shipping and golf — with a skyline of skyscrapers, one over 2,700 feet high, that would be the envy of Hong Kong or Manhattan.
And it has all been done in the shadow (and with the envy) of a dangerous Islamic Republic of Iran. When I first visited Dubai in 1980, there were still traditional wooden fishing dhows in the harbor. Today, DP World, the Emirati logistics company, manages cargo logistics and port terminals all over the world. Any of Dubai’s neighbors — Kuwait, Qatar, Oman, Bahrain, Iran and Saudi Arabia — could have done the same with their similar coastlines, but it was the U.A.E. that pulled it off by making the choices it made.
I toured the site of the U.N.’s global climate conference with the U.A.E.’s minister of state for international cooperation, Reem al-Hashimy, who oversaw the building of Dubai’s massive 2020 Expo City, which was repurposed to hold the event. In three hours spent walking around, we were stopped at least six or seven times by young Emirati women in black robes in groups of two or three, who asked if I could just step aside for a second while they took selfies with Reem or whether I would be their photographer. She was their rock-star role model — this Harvard- and Tufts-educated, nonroyal woman in a leadership role as a government contractor.
Compare that with Gaza, where the role models today are Hamas martyrs in its endless war with Israel.
Among the most ignorant and vile things that have been said about this Gaza war is that Hamas had no choice — that its wars with Israel, culminating on Oct. 7 with a murderous rampage, the kidnappings of Israelis as young as 10 months and as old as 86 and the rape of Israeli women, could somehow be excused as a justifiable jailbreak by pent-up males.
No.
Let’s go to the videotape: In September 2005, Ariel Sharon completed a unilateral withdrawal of all Israeli forces and settlements from Gaza, which Israel occupied in the 1967 war. In short order, Hamas began attacking the crossing points between Gaza and Israel to show that even if Israel was gone, the resistance movement wasn’t over; these crossing points were a lifeline for commerce and jobs, and Israel eventually reduced the number of crossings from six to two.
In January 2006, the Palestinians held elections hoping to give the Palestinian Authority legitimacy to run Gaza and the West Bank. There was a debate among Israeli, Palestinian and Bush administration officials over whether Hamas should be allowed to run in the elections — because it had rejected the Oslo peace accords with Israel.
Yossi Beilin, one of the Israeli architects of Oslo, told me that he and others argued that Hamas should not be allowed to run, as did many members of Fatah, Arafat’s group, who had embraced Oslo and recognized Israel. But the Bush team insisted that Hamas be permitted to run without embracing Oslo, hoping that it would lose and this would be its ultimate refutation. Unfortunately, for complex reasons, Fatah ran unrealistically high numbers of candidates in many districts, dividing the vote, while the more disciplined Hamas ran carefully targeted slates and managed to win the parliamentary majority.
Hamas then faced a critical choice: Now that it controlled the Palestinian parliament, it could work within the Oslo Accords and the Paris protocol that governed economic ties between Israel, Gaza and the West Bank — or not.
Hamas chose not to — making a clash between Hamas and Fatah, which supported Oslo, inevitable. In the end, Hamas violently ousted Fatah from Gaza in 2007, killing some of its officials and making clear that it would not abide by the Oslo Accords or the Paris protocol. That led to the first Israeli economic blockade of Gaza — and what would be 22 years of on-and-off Hamas rocket attacks, Israeli checkpoint openings and closings, wars and cease-fires, all culminating on Oct. 7.
These were fateful choices. Once Sharon pulled Israel out of Gaza, Palestinians were left, for the first time ever, with total control over a piece of land. Yes, it was an impoverished slice of sand and coastal seawater, with some agricultural areas. And it was not the ancestral home of most of its residents. But it was theirs to build anything they wanted.
Had Hamas embraced Oslo and chosen to build its own Dubai, not only would the world have lined up to aid and invest in it; it would have been the most powerful springboard conceivable for a Palestinian state in the West Bank, in the heart of the Palestinian ancestral homeland. Palestinians would have proved to themselves, to Israelis and to the world what they could do when they had their own territory.
But Hamas decided instead to make Gaza a springboard for destroying Israel. To put it another way, Hamas had a choice: to replicate Dubai in 2023 or replicate Hanoi in 1968. It chose to replicate Hanoi, whose Củ Chi tunnel network served as the launchpad for the ’68 Tet offensive.
Hamas is not simply engaged in some pure-as-the-driven-snow anticolonial struggle against Israel. Only Hamas’s useful idiots on U.S. college campuses would believe that. Hamas is engaged in a raw power struggle with Fatah over who will control Gaza and the West Bank, and it’s engaged in a power struggle in the region — alongside other pro-Muslim Brotherhood parties and regimes (like Turkey and Qatar) — against pro-Western monarchies like Saudi Arabia, Jordan, Kuwait and the U.A.E. and military-led regimes like Egypt’s.
In that struggle, Hamas wanted Gaza isolated and in conflict with Israel because that allowed Hamas to maintain its iron-fisted political and Islamist grip over the strip, forgoing elections and controlling all the smuggling routes in and out, which funded its tunnels and war machine and the lifestyle of its leaders and loyalists — every bit as much as Iran’s Islamic regime today needs its hostility with America to justify its iron grip over Iranian society and the Revolutionary Guard’s control of all of its smuggling. Every bit as much as Hezbollah needs its conflict with Israel to justify building its own army inside Lebanon, controlling its drug smuggling and not permitting any Lebanese government hostile to its interests to govern, no matter who is elected. And every bit as much as Vladimir Putin needs his conflict with NATO to justify his grip on power, the militarization of Russian society and his and his cronies’ looting of the state coffers.
This is now a common strategy for consolidating and holding power forever by a single political faction and disguising it with an ideology of resistance. It’s no wonder they all support one another.
There is so much to criticize about Israel’s occupation of the West Bank, which I have consistently opposed. But please, spare me the Harvard Yard nonsense that this war is all about the innocent, colonized oppressed and the evil, colonizing oppressors; that Israel alone was responsible for the isolation of Gaza; and that the only choice Hamas had for years was to create an underground “skyline” of tunnels up to 230 feet deep (contra Dubai) and that its only choice on Oct. 7 was martyrdom.
Credit…Pool photo by Menahem Kahana
Hamas has never wavered from being more interested in destroying the Jewish state than in building a Palestinian state — because that goal of annihilating Israel is what has enabled Hamas to justify its hold on power indefinitely, even though Gaza has known only economic misery since Hamas seized control.
We do those Palestinians who truly want and deserve a state of their own no favors by pretending otherwise.
Gazans know the truth. Fresh polling data reported by AFP indicates that on the eve of Oct. 7, “many Gazans were hostile to Hamas ahead of the group’s brutal Oct. 7 attack on Israel, with some describing its rule as a second occupation.”
As Hamas’s grip over Gaza is loosened, I predict we will hear a lot more of these Gazan voices on what they really think of Hamas, and it will be embarrassing to Hamas’s apologists on U.S. campuses.
But our story about agency and choices does not stop there. Benjamin Netanyahu, Israel’s longest-serving prime minister — 16 years — also made choices. And even before this war, he made terrible ones — for Israel and for Jews all over the world.
The list is long: Before this war, Netanyahu actively worked to keep the Palestinians divided and weak by strengthening Hamas in Gaza with billions of dollars from Qatar, while simultaneously working to discredit and delegitimize the more moderate Palestinian Authority in Ramallah, committed to Oslo and nonviolence in the West Bank. That way Netanyahu could tell every U.S. president, in effect: I’d love to make peace with the Palestinians, but they are divided, and moreover, the best of them can’t control the West Bank and the worst of them control Gaza. So what do you want from me?
Netanyahu’s goal has always been to destroy the Oslo option once and for all. In that, Bibi and Hamas have always needed each other: Bibi to tell the United States and Israelis that he had no choice, and Hamas to tell Gazans and its new and naïve supporters around the world that the Palestinians’ only choice was armed struggle led by Hamas.
The only exit from this mutually assured destruction is to bring in some transformed version of the Palestinian Authority in the West Bank — or a whole new P.L.O.-appointed government of Palestinian technocrats — in partnership with moderate Arab states like Egypt, Jordan and Saudi Arabia. But when I raise that with many Israelis right now, they tell me, “Tom, it’s not the time. No one wants to hear it.”
That makes me want to scream: No, it is exactly the time. Don’t they get it? Netanyahu’s greatest political achievement has been to persuade Israelis and the world that it’s never the right time to talk about the morally corrosive occupation and how to help build a credible Palestinian partner to take it off Israel’s hands.
He and the settlers wore everyone down. When I covered the State Department in the early 1990s, West Bank settlements were routinely described by U.S. officials as “obstacles to peace.” But that phrase was gradually dropped. The Trump administration even decided to stop calling the West Bank “occupied” territory.
The reason I insist on talking about these choices now is because Israel is being surrounded by what I call Iran’s landcraft carriers (as opposed to our aircraft carriers): Hamas, Hezbollah, the Houthis and Shiite militias in Iraq. Iran is squeezing Israel into a multifront war with its proxies. I truly worry for Israel.
But Israel will have neither the sympathy of the world that it needs nor the multiple allies it needs to confront this Iranian octopus, nor the Palestinian partners it needs to govern any post-Hamas Gaza, nor the lasting support of its best friend in the world, Joe Biden, unless it is ready to choose a long-term pathway for separating from the Palestinians with an improved, legitimate Palestinian partner.
Biden has been shouting that in Netanyahu’s ears in their private calls.
For all these reasons, if Netanyahu keeps refusing because, once again, politically, the time is not right for him, Biden will have to choose, too — between America’s interests and Netanyahu’s.
Netanyahu has been out to undermine the cornerstone of U.S. Middle East policy for the last three decades — the Oslo framework of two states for two people that guarantees Palestinian statehood and Israeli security, which neither side ever gave its best shot. Destroying the Oslo framework is not in America’s interest.
In sum, this war is so ugly, deadly and painful, it is no wonder that so many Palestinians and Israelis want to just focus on survival and not on any of the choices that got them here. The Haaretz writer Dahlia Scheindlin put it beautifully in a recent essay:
The situation today is so terrible that people run from reality as they run from rockets — and hide in the shelter of their blind spots. It’s pointless to wag fingers. The only thing left to do is try and change that reality.
For me, choosing that path will always be in season.
Top security official calls on world to supply arms to ensure Ukraine defeats Russia
The New Voice of Ukraine – January 2, 2024
Oleksiy Danilov
National Security and Defense Council Secretary Oleksiy Danilov has reacted to Russia’s massive missile attack on Ukraine by calling on the world to provide Kyiv with more weapons to eliminate Russian aggression.
“Only the systematic, consistent and methodical destruction of Putin’s fascist formation is the best guarantee of security for Ukraine and the world, the absence of a missile threat to peaceful cities,” Danilov said in a Facebook post on Jan. 2.
“Give Ukraine weapons and we will bury this (enemy)…”
The air defense forces will continue to fight, no matter how many missiles are flying at Ukraine, the top security official said.
“There is no force that can stop us until all 513 killed Ukrainian children, fallen defenders, and every innocent tortured Ukrainian soul are avenged!” he said.
The falling debris set at least three multi-story residential buildings on fire in the Ukrainian capital. Two people have been reported dead, including an elderly woman who was injured when a missile fragment hit a high-rise building in the Solomyanskyi district. She died in an ambulance. Another 43 victims have been hospitalized.
Turkey blocks passage of British minehunter ships destined for Ukraine
Dmytro Basmat – January 2, 2024
Two British minehunter ships destined for Ukraine will not be able to travel through Turkish waters, President Erdogan’s Directorate of Communications announced on Jan. 2, citing an international pact.
“Our pertinent allies have been duly apprised that the mine-hunting ships donated to Ukraine by the United Kingdom will not be allowed to pass through the Turkish Straits to the Black Sea as long as the war continues,” a statement from the President’s communications office read.
Referring to an international convention which governs maritime traffic in the region, the Turkish government emphasized that Russian and Ukrainian warships are prohibited from entering Turkish Straits due to the ongoing war.
As per the Montreux Convention, warships from non-belligerent nations are allowed passage through the straits during wartime. However, the convention also states that Ankara retains the ultimate authority over the passage of all warships, if Turkey perceives a risk of being involved in the conflict.
The United Kingdom’s Ministry of Defense revealedits plan to donate Sandown class vessels from Britain’s Royal Navy last month, amid the ongoing disbursement of sea mines in the Black Sea. The donated minehunter ships were intended to clear sea mines for the safe passage of larger ships, as well as “help save lives at sea and open up vital export routes.”
The Netherlands has also previously pledged two Alkmaar class minehunter ships to Ukraine to arrive in the Black Sea by 2025. It is now unclear if the intended donation will reach Ukraine.
Hundreds of mines have been spread throughout the Black Sea since the beginning of Russia’s full-scale invasion in February 2022. On several occasions, civilian ships or navy ships belonging to countries not party to the war struck sea mines.
Seven ways the exodus of Western companies has cratered the Russian economy.
By Jeffery A. Sonnenfeld, the Lester Crown professor in management practice and a senior associate dean at the Yale School of Management, and Steven Tian, the director of research at the Yale Chief Executive Leadership Institute. – December 22, 2023
Russian President Vladimir Putin holds his year-end press conference at Gostiny Dvor exhibition hall in central Moscow.
This is perhaps the most dire moment for Ukraine since Russia’s invasion in February 2022, with the military situation on the battlefield seemingly stalemated, Western political support wavering under the weight of political dysfunction, and war in the Middle East diverting resources and attention.
Nevertheless, many reflexive cynics in the Western press are going too far in crediting Ukraine’s adversary, Russian President Vladimir Putin, with one Wall Street Journal columnist even declaring Putin one of the “winners of the year.” We cannot fall into the trap of thinking that all is good for Putin, and we cannot jettison effective measures to pressure him. Just this week, the New York Times even suggested that the exit of more than 1,000 multinational companies from Russia has backfired by enriching Putin and his cronies.
All the evidence suggests there are, in fact, ample costs of the business exodus. Economic data clearly shows that the Russian economy has paid a huge price for the loss of those businesses. Putin continues to conceal the required disclosure of Russia’s national income statistics—obviously because they are nothing to brag out.
Transferring nearly worthless assets does not make Russia or Putin cronies wealthier. While Putin expropriated some assets of Asian and Western companies, most firms simply abandoned them, eagerly writing down billions of dollars in assets. They were rewarded for doing so as their market capitalization soared upon the news of their exits. Russia is not only suing foreign companies for leaving, as ExxonMobil’s and BP’s departures ended the technology needed for exploration, but Russian oil giant Rosneft even sued Reuters for reporting on it. The massive supply disruptions shuttering Russian factories across sectors were described in on-the-ground reporting by the Journal, which resulted in the arrest and now nine-month imprisonment of the heroic journalist who documented the truth.
Consider the following economic statistics we have verified.
Talent flight. In the first months after the invasion, an estimated 500,000 individuals fled Russia, many of whom were exactly the highly educated, technically skilled workers Russia cannot afford to lose. In the year-plus since, that number has ballooned to at least 1 million individuals. By some counts, Russia lost 10 percent of its entire technology workforce from this unprecedented talent flight.
Capital flight. Per the Russian Central Bank’s own reports, a record $253 billion in private capital was pulled out of Russia between February 2022 and June 2023, which was more than four times the amount of prior capital outflows. By some measures, Russia lost 33 percent of the total number of millionaires living in Russia when those individuals fled.
Loss of Western technology and knowhow. This occurred across key industries such as technology and energy exploration. For example, Rosneft alone has had to spend nearly $10 billion more on capital expenditure over the last year by its own disclosure, which amounts to roughly $10 of additional expenses for every barrel of oil exported, on top of difficulties continuing its Arctic oil drilling projects, which were almost solely dependent on Western tech and expertise.
Near-complete halt in foreign direct investment into Russia. Foreign direct investment (FDI) into Russia has come to a near-complete stop by several measures. There has been only one month of positive inflows in the 22 months since the invasion, compared with approximately $100 billion in FDI annually before the war.
Loss of the ruble as a freely convertible and exchangeable currency. With global multinationals fleeing in such droves, there was little to stop Putin from implementing unprecedented, strict capital controls on the ruble post-invasion, such as banning citizens from sending money to bank accounts abroad; suspending cash withdrawals from dollar banking accounts beyond $10,000; forcing exporters to exchange 80 percent of their earnings for rubles; suspending direct dollar conversions for individuals with ruble banking accounts; suspending lending in dollars; and suspending dollar sales across Russian banks. No wonder ruble trading volumes are down 90 percent, making Russian assets valued in rubles virtually worthless and unexchangeable in global markets.
Loss of access to capital markets. Western capital markets remain the deepest, most liquid, and cheapest source of capital to fund business and risk-taking. Since the start of the invasion, no Russian company has been able to issue any new stock or any new bonds in any Western financial market—meaning they can only tap the coffers of domestic funding sources such as Putin’s state-owned banks for loans at usurious rates (and still increasing, with the benchmark interest rate at 16 percent). And with multinational companies having fled, Russian business ventures have no alternative sources of funding and no global investors to tap.
Massive destruction of wealth and plummeting asset valuations. Thanks in part to the mass exodus of global multinational businesses, asset valuations have plummeted across the board in Russia, with even the total enterprise value of some state-owned enterprise down 75 percent compared with prewar levels, according to our research, on top of 50 percent haircuts in the valuation of many private sector assets, as cited in the Times.
The Liberian-flagged oil tanker Ice Energy (left) transfers crude oil from the Russian-flagged oil tanker Lana (right), off the coast of Greece, on May 29, 2022.Ukrainian President Volodymyr Zelensky gestures with an open hand while speaking during a TV news interview. Zelensky is dressed in his typical black t-shirt and is seated at a desk in front of a bright blue wall.A woman poses for a photo in front of a tall decorated Christmas tree in front of a war-damanged building in Melitopol in Ukraine’s Zaporizhzhia region with a Russian flag flying from a tall pole overhead.
These are just some of the costs imposed on Putin by the withdrawal of 1,000-plus global businesses; it does not consider the deleterious impact on the Russian economy of economic sanctions, such as the highly effective oil price cap devised by the U.S. Treasury Department. More than two-thirds of Russia’s exports were energy, and that is now slicedin half. Russia, which never supplied any finished goods—industrial or consumer—to the global economy, is paralyzed. It is not remotely an economic superpower, with virtually all of its raw materials easily substituted from elsewhere. The war machine is driven only by the cannibalization of now state-controlled enterprises.
Based on our ample economic data, the verdict is clear: The unprecedented, historic exodus of 1,000-plus global companies has helped cripple Putin’s war machine. At such a dire moment for Ukraine, it would be a mistake to be too Pollyannaish—just as it would be a mistake to be too cynical.
Russia’s economy is paralyzed, and Putin’s war machine survives on cannibalizing state-owned firms, Yale researchers say
Jason Ma – December 27, 2023
Russia’s economy is paralyzed, and its war machine survives by cannibalizing state-owned firms.
That’s according to Yale professors pushing back on commentary that Putin is one 2023’s big winners.
“We cannot fall into the trap of thinking that all is good for Putin,” they said.
Russia’s economy is paralyzed, and its war machine survives on cannibalizing state-owned firms, two Yale researchers said.
In an op-ed in Foreign Policy on Friday, Jeffrey Sonnenfeld and Steven Tian pushed back on recent commentary that cast Russian President Vladimir Putin as one of 2023’s big winners amid signs of economic resilience.
But Western sanctions and the mass exodus of multinational companies from Russia have inflicted huge costs on the nation’s economy, they said.
“We cannot fall into the trap of thinking that all is good for Putin, and we cannot jettison effective measures to pressure him,” Sonnenfeld and Tian wrote, adding that transferring “worthless” expropriated assets from Western firms to Putin’s cronies didn’t make Russia wealthier.
They also listed several other signs that Russia’s economy had been reeling.
Since Russia invaded Ukraine in early 2022, at least 1 million Russians have fled to other countries, including top tech talent. That’s contributed to a labor shortage that’s nearing 5 million workers and has stoked high inflation.
Meanwhile, $253 billion in private capital left Russia between February 2022 and June 2023, Sonnenfeld and Tian said, citing the Russian central bank’s data.
In addition, Russia has lost access to Western technology and expertise that its companies relied on, while foreign direct investment has nearly dried up.
Making matters worse are strict capital controls that have rendered Russian assets valued in rubles virtually worthless on global markets.
And sanctions that cut off Moscow from much of international finance have prevented Russian companies from issuing any new stock or bond in a Western market.
“Russia, which never supplied any finished goods — industrial or consumer — to the global economy, is paralyzed,” Sonnenfeld and Tian said. “It is not remotely an economic superpower, with virtually all of its raw materials easily substituted from elsewhere. The war machine is driven only by the cannibalization of now state-controlled enterprises.”
Even the Kremlin is bracing for more pain. On Monday, Russia’s central-bank governor, Elvira Nabiullina, said she’s expecting more sanctions.
While Russia has weathered the economic storms of the past two years, Nabiullina warned against thinking the country was “10 feet tall,” a translation from TASS, a state news agency, said. She added that the pressure from sanctions could intensify and the country must prepare for it.
Russian military executes Ukrainian POWs near Robotyne, investigation initiated
The New Voice of Ukraine – December 27, 2023
Shell casings on the ground in a trench near the frontline in the east
Russian forces executed Ukrainian prisoners of war near Robotyne in Zaporizhzhya Oblast in December, leading to Ukraine’s Prosecutor General’s Office launching an investigation.
Russian armed forces took three Ukrainian defenders captive during a skirmish with the Ukrainian Defense Forces. An hour later, the captives were shot by the occupiers, and the video surfaced on the internet, Prosecutor General’s Office reported on Telegram on Dec. 27.
The execution by Russians violates Article 3 of the Geneva Convention on the treatment of prisoners of war.
Law enforcement has initiated a criminal case on the fact of violating laws and customs of war, combined with intentional murder.
This is not the first instance where Ukraine has reported the execution of Ukrainian military personnel taken captive by Russian forces. In October, the United Nations documented six such cases in its report.
In early December, a video circulated on social media depicting two Russian military personnel shooting two surrendered Ukrainian soldiers with their hands held behind their heads. This was later confirmed by the Armed Forces of Ukraine. Preliminary findings from investigators place the execution in the vicinity of Stepove village in Pokrovsky district, Donetsk Oblast.
In early September, Ukrainian Prosecutor General Andriy Kostin said that some 90% of Ukrainian POWs had been tortured, raped, threatened with sexual violence, or otherwise ill-treated.
Russian mass surrender in Zaporizhzhya sector after inhumane treatment and heavy losses
The New Voice of Ukraine – December 27, 2023
Russian military
A second group of Russian occupiers from the 71st regiment of the Russian Armed Forces surrendered on the Zaporizhzhya front, reporting mistreatment by the Russian command and significant losses, OC West Telegram channel reported on Dec. 27.
Russian military personnel spoke out about the “inhumane treatment” by the Russian command and significant losses. The prisoners claim that the command deploys groups of recently mobilized and untrained soldiers, along with those who have signed contracts, for daily assaults, according to the OC West report.
Commanders of the 71st regiment are accused of deploying groups of recently mobilized and unprepared soldiers, including those under contract, for daily storming operations. Prior to deployment, commanders allegedly mislead soldiers about their proximity to the front line, resulting in a lack of essential supplies and prompting surrenders, the OC West said.
The Russian command reportedly compelled soldiers from the 71st regiment to pre-record New Year greetings before storming operations, possibly to conceal losses from the Russian public.
President Volodymyr Zelenskyy said on Dec. 19 that the exchange of prisoners of war between Ukraine and Russia has slowed down due to “very specific reasons” on the Russian side, suggesting potential diplomatic challenges.
Alexei Navalny says he is ‘doing fine’ in special regime Arctic prison
Euronews – December 26, 2023
The imprisoned Russian opposition figure Alexei Navalny, whose fate is causing concern in the West, said on Tuesday that he was “doing well” after a long and “tiring” transfer to a remote prison colony in the Russian Arctic.
His family, who had had no news of him for nearly three weeks, announced on Monday that they had traced him to a penal colony in Kharp, in the Yamalo-Nenets region, beyond the Arctic Circle.
They claim that the Russian authorities are seeking to isolate him even further, a few months before the March 2024 presidential election in which Vladimir Putin‘s victory appears to be a foregone conclusion.
In his first message on social networks since his disappearance, Alexei Navalny said that the 20-day journey to his new place of detention had been “quite tiring”.
“But I’m in good spirits, like Father Christmas”, he added, referring to his “beard” which had grown during the long journey and his new winter clothes suitable for polar temperatures.
“Whatever happens, don’t worry about me. I’m fine. I’m relieved to have finally arrived”, he said.
Alexei Navalny, 47, a charismatic anti-corruption campaigner and Vladimir Putin’s number one enemy, is serving a 19-year prison sentence for “extremism”.
He was arrested in January 2021 on his return from convalescing in Germany for poisoning, which he blames on the Kremlin.
He disappeared at the beginning of December from the prison colony in the Vladimir region, 250 kilometers east of Moscow, where he had been held until then, which meant that he was likely to be transferred to another establishment.
‘Special regime’ colony
According to the verdict for “extremism” against Mr Navalny, the opponent must serve his sentence in a “special regime” colony, the category of establishments where conditions of detention are the harshest and which are usually reserved for lifers and the most dangerous prisoners.
He said he had arrived at his new prison colony on Saturday evening, after a discreet journey and “such a strange itinerary” that he did not expect to be found by his family until mid-January.
“That’s why I was surprised when the cell door opened yesterday and I was told: ‘A lawyer is here for you'”, he said, expressing his gratitude for the “support” he had received.
One of his close associates, Ivan Jdanov, accused the Russian authorities of trying to “isolate” him in the run-up to the presidential election.
a group of officers walk inside a prison colony in the town of Kharp, in the Yamalo-Nenetsk region. – AP/Human rights ombudsman of Yamalo-Nenets Autonomous District
According to him, Alexei Navalny is being held in “one of the northernmost and most remote settlements” in Russia, where conditions are “difficult”.
In the West, his disappearance caused concern that was not entirely allayed by his reappearance in a very remote region.
On Monday, the United States said it was “deeply concerned” about Alexei Navalny’s “conditions of detention” and demanded his release.
Mr Navalny’s movement has been methodically eradicated by the authorities in recent years, driving his collaborators and allies into exile or prison.
In early December, the Russian authorities brought new charges of “vandalism” against the anti-corruption activist, which could add another three years to his sentence.
Vladimir Putin is aiming for a new six-year term in the Kremlin in the March presidential election, a term that would take him until 2030, when he turns 78.
